Consumer confidence drops marking ‘season of uncertainty’

Market research firm GfK’s latest Consumer Confidence Index has shown that confidence decreased by three points in November 2018 to -13.

There were declines recorded across all five measures used to calculate the Index including general economic situation and personal financial situation.

The index measuring changes in personal finances during the last 12 months has decreased four points this month to -3; two points lower than at the same point last year. The forecast for personal finances over the next 12 months decreased one point to +3 this month; one point higher than November 2017.

The general economic situation of the country during the last 12 months dropped by one point to -29 this month; three points higher than November 2017, however expectations for this measure over the next 12 months decreased four points to -32; four points lower than the same month last year.

The major purchase index decreased seven points in November to -3; recorded at the same level as last year. The savings index stayed at the same level this month at +12; four points higher than this time last year. This measure recorded the sharpest drop which the market research company described as “unhappy news for retailers”.

Joe Staton, client strategy director at GfK, said: “Against a backdrop of the chancellor telling everyone that the Brexit deal on the table will make people worse off, this month we’re recording an across the board fall for all measures with concerns over household finances, the general economy and purchase intentions.

“The measure that fell the most is our major purchase index, with a seven-point plunge that is unhappy news for retailers. The view on the general economy in the coming 12 months fell four points, as did the perception of the past year’s personal finances. Overall, we are now back at the -13 level we saw at the end of last year. The next few weeks are highly unlikely to inject any festive cheer, especially if Theresa May’s Brexit deal doesn’t win backing from MPs.”

He added: “The denouement to more than two years of bewildering Brexit wheeler-dealing looks like it will be enacted precisely when many consumers would prefer to be thinking of a well-earned Christmas break, filled with family get-togethers, warmth and festivity. Brexit appears to be turning this year’s ‘season of goodwill’ into ‘the season of uncertainty’.”